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USD/JPY Discussion

  • #27,181
  • Sep 15, 2011 12:33am Sep 15, 2011 12:33am
Usd/Jpy Buy at 76.35/40, 76.25/30, 75.95/00, sell at 77.00/05, 77.20/25, 77.35/40

Usd/Jpy This pair is on daily downtrend basis with an overall sideways movement, below retracement at 76.90/95, break is to 77.10/15, above is to target 77.60/70, while low prcie level is at 76.20/30

**If SNB intervened today with around 2 hours to SNB Monetary policy & rate decisons, this would help yen pairs to spike upward especially Euro/Jpy with SNB buying Euro, so it might not be necessary for BOJ to act in such situation despite that even Euro/Jpy at 108 -109, Gbp/Jpy at 124-125 & Usd/Jpy at 77- 78 is not acceptable by BOJ, so it would be Great to see yen pairs spike with possible SNB Intervention or at least strong news statement which is expected would help Chf pairs boost to the upside & take yen pairs with, then BOJ intervene later on
  • #27,182
  • Sep 15, 2011 1:17am Sep 15, 2011 1:17am
Quoting TheMoneMaker
**If SNB intervened today with around 2 hours to SNB Monetary policy & rate decisons, this would help yen pairs to spike upward especially Euro/Jpy with SNB buying Euro, so it might not be necessary for BOJ to act in such situation despite that even Euro/Jpy at 108 -109, Gbp/Jpy at 124-125 & Usd/Jpy at 77- 78 is not acceptable by BOJ, so it would be Great to see yen pairs spike with possible SNB Intervention or at least strong news statement which is expected would help Chf pairs boost to the upside & take yen pairs with, then BOJ intervene later...
How could SNB intervention depreciate the Jpy ? Did it depreciate when the SNB stept in a few weeks ago ? Not to my knowledge, it appreciated knowing that Chf was no longer a safe haven leaving the Jpy as one of the few valid options left. If the Swiss intervene, it again makes crystal clear that they don't stick to announcements but act ! This in contrast to the Japanese. Credibility is the name of the game, Swiss have it, Japan is losing it as days pass by.

Jpy will not depreciate unless Boj/Mof steps up to the plate. If its up to markets Jpy will appreciate even further.
  • #27,183
  • Sep 15, 2011 4:09am Sep 15, 2011 4:09am
This is from Simon Smith, Chief Economist for FxPro. I listen to his words. He is consistently accurate with his comments:

Do not underestimate the dollar. Battered for most of this year, especially in the first few months, the dollar is enjoying a much better spell. Over the course of this week, the dollar’s gains have been more apparent against the high-beta emerging currencies of Asia and Latin America. For instance, both the Mexican peso and the Brazilian real have fallen by more than 3%. From our perspective, this improved performance by the dollar is not a surprise. Given the sovereign debt and banking drama which is crippling confidence in the euro, and with both the Swiss National Bank and the Japanese MoF prepared to risk all to prevent further currency strength, it is little wonder that the world’s foremost reserve currency is attracting a lot of inflow. Perpetuating the dollar’s apparent appeal is the perception that America’s major banks are better capitalised than their European counterparts. Large American money-market funds, which in the past have been significant buyers of European paper, are increasingly reluctant to lend to the Continent. This hesitation accounts for a good part of the funding difficulties being experienced by major banks in Europe, especially in France. In addition, European banks themselves are much less inclined to lend to other counterparties within Europe. Instead, they are choosing to lift their dollar deposits, either by leaving them with one of the major US banks or depositing them with the super-safe Federal Reserve. Since the end of last year, foreign banks have more than doubled their reserve holdings at the Fed. Clearly, European banks have been hoarding dollars at the Fed over recent months, concerned at the increasing difficulty of getting dollar funding in the wholesale market and concerned about counterparty risk. If European banks want to continue to lift their dollar reserves in the future, they may well need to buy them from US banks. In part, this is likely to contribute to potential dollar strength.
Observation is the path to discovery.
  • #27,184
  • Sep 15, 2011 4:23am Sep 15, 2011 4:23am
Here is the current chart (H4). Look at the price action respecting the bottom wall of the Price channel. The RSI trendline is still holding (bottom), but most importantly, the trix is opening (Fast Trix rising faster than Slow Trix). This is looking better and better for the bulls. What will be the trigger that gets us moving up? Maybe unemployment claims today. If we take off, the top of the channel at 78 will be the target. It may not happen in a straight line but we´ll get there. I feel confident.
Attached Image (click to enlarge)
Click to Enlarge Name: usdjpy.jpg Size: 117 KB
Observation is the path to discovery.
  • #27,185
  • Sep 15, 2011 4:24am Sep 15, 2011 4:24am
Quoting Alorente
This is from Simon Smith, Chief Economist for FxPro. I listen to his words. He is consistently accurate with his comments:

Do not underestimate the dollar.
I have been reading similar analysis for a few days now.....it all sounds logical, so we will have to see how this effects the UJ pair. I disagree with the analysis in as much as I think money is flowing into USD and Yen, which is why we're not seeing the UJ pair climbing. I read somewhere today, but I forget where, the amount of Yen selling compared to Yen buying, and Yen is still being bought in very large amounts. Until that stops, this pair isn't going anywhere!
Doing what you like is Freedom. Liking what you do is Happiness.
  • #27,186
  • Sep 15, 2011 4:58am Sep 15, 2011 4:58am
Quoting realjumper
I have been reading similar analysis for a few days now.....it all sounds logical, so we will have to see how this effects the UJ pair. I disagree with the analysis in as much as I think money is flowing into USD and Yen, which is why we're not seeing the UJ pair climbing. I read somewhere today, but I forget where, the amount of Yen selling compared to Yen buying, and Yen is still being bought in very large amounts. Until that stops, this pair isn't going anywhere!
I have to admit. I have been impressed with the continued strengthening of the Yen. I can't say I'm surprised because I've come to expect anything in this game. Having traded for years now teaches you how irrational and unexpected currency moves can be. With that said I didn't think this currency would strengthen this much and for this length of time.

I will also admit I don't understand what makes Japan's yen considered such a safe haven? It's basically a big volcanic rock on a major fault line. They rely heavily on exporting to consumer nations who are all spending less than ever due to the state of the world economy. Their interest rate is crap, but that doesn't really explain anything since rates are normally a reflection of risk. Could it be that many low to mid level investors use the Yen as a cross in their carry trades and institutions are squeezing every drop they can out of this lemon? I mean seriously, why such high demand for Yen? Is there more to the Euro that we don't know? Is the Euro going to be obsolete in 5 years? Is the US dollar not getting same demand because everyone is expecting the Fed to print like hell for years to come? I'd like to read someone elses thoughts.
  • #27,187
  • Sep 15, 2011 5:08am Sep 15, 2011 5:08am
Quoting 2+2=4ex
I have to admit. I have been impressed with the continued strengthening of the Yen. I can't say I'm surprised because I've come to expect anything in this game. Having traded for years now teaches you how irrational and unexpected currency moves can be. With that said I didn't think this currency would strengthen this much and for this length of time.

I will also admit I don't understand what makes Japan's yen considered such a safe haven? It's basically a big volcanic rock on a major fault line. They rely heavily on exporting to consumer nations...
All good questions......and I have no answers I'm afraid. I have asked the same main question.......why flock to the Yen? The answers I get back are convoluted and run into several pages, none of which I understand!! Someone, somewhere, must have a one sentence answer to this (seemingly) simple question!!!
Doing what you like is Freedom. Liking what you do is Happiness.
  • #27,188
  • Sep 15, 2011 5:11am Sep 15, 2011 5:11am
Quoting 2+2=4ex
I have to admit. I have been impressed with the continued strengthening of the Yen. I can't say I'm surprised because I've come to expect anything in this game. Having traded for years now teaches you how irrational and unexpected currency moves can be. With that said I didn't think this currency would strengthen this much and for this length of time.

I will also admit I don't understand what makes Japan's yen considered such a safe haven? It's basically a big volcanic rock on a major fault line. They rely heavily on exporting to consumer nations...
I agree with you. It´s totally irrational. That´s why I don´t trade the fundamentals. Still, the big turns in markets happen at extremes of irrationality. It happened with the euro recently when nobody could understand how it could levitate at 1.45 in the face of near disaster for months. Well, it levitated until it stopped doing so and then it fell like a rock. The same thing will happen to the Yen. The technicals are telling me that the time is near. I don´t know what the trigger will be, but who cares? It will happen. That´s why I´m building a position and waiting patiently. It will be worth it, just like the euro wait was worth it.
Observation is the path to discovery.
  • #27,189
  • Sep 15, 2011 5:13am Sep 15, 2011 5:13am
Quoting realjumper
I have been reading similar analysis for a few days now.....it all sounds logical, so we will have to see how this effects the UJ pair. I disagree with the analysis in as much as I think money is flowing into USD and Yen, which is why we're not seeing the UJ pair climbing. I read somewhere today, but I forget where, the amount of Yen selling compared to Yen buying, and Yen is still being bought in very large amounts. Until that stops, this pair isn't going anywhere!
Maybe Some Big and Old Investor though Chinese Yuan Is Japanese Yen,So they keep buying Yen,until they realise it "Omg,We should buy Yuan Instead than Yen!"
If there was easy money lying around,no one would be forcing it into your
  • #27,190
  • Sep 15, 2011 5:16am Sep 15, 2011 5:16am
Quoting FXMindset
Maybe Some Big and Old Investor though Chinese Yuan Is Japanese Yen,So they keep buying Yen,until they realise it "Omg,We should buy Yuan Instead than Yen!"
LOL. That one made me laugh.

Thanks for the replies fellas. Maybe some day we'll know all the answers.
  • #27,191
  • Sep 15, 2011 5:21am Sep 15, 2011 5:21am
Thinking about it the last several minutes, the one thing that maybe sticks out for me is the development of southeast Asia. Countries like Malaysia, Singapore, Indonesia, Thailand, etc. Perhaps Japan is a big part behind the drive for development of these nations. They may also be benefiting from assisting China with technologies. I really don't know, just speculating.
  • #27,192
  • Sep 15, 2011 5:22am Sep 15, 2011 5:22am
Quoting 2+2=4ex
LOL. That one made me laugh.

Thanks for the replies fellas. Maybe some day we'll know all the answers.
Hopefully soon my sister,since this sidelines struggling for almost a month and normally some big moves would be happening in this situation

Hopes everything being well yo
If there was easy money lying around,no one would be forcing it into your
  • #27,193
  • Sep 15, 2011 6:40am Sep 15, 2011 6:40am
Usd versus Jpy:

- interest rates in both countries are at record lows, so no big difference there
- unemployment in Japan way lower than in the US / 4.7% vs 9.1%
- Japan has larger trade surplusses (%wise) than the US
- savings larger in Japan than US
- far more QE in US than Japan

So, imo, depreciation of Jpy can only happen when Boj/Mof intervene. Based on economic numbers and prospects Jpy will continue appreciating.
  • #27,194
  • Sep 15, 2011 6:49am Sep 15, 2011 6:49am
Quoting SIgurs
Usd versus Jpy:

- interest rates in both countries are at record lows, so no big difference there
- unemployment in Japan way lower than in the US / 4.7% vs 9.1%
- Japan has larger trade surplusses (%wise) than the US
- savings larger in Japan than US
- far more QE in US than Japan

So, imo, depreciation of Jpy can only happen when Boj/Mof intervene. Based on economic numbers and prospects Jpy will continue appreciating.
I believe Noda will start the printing presses soon. Japanese inflation is non existant, they want the currency down and ink and paper are cheap. When it looks like a duck, it quacks like a duck and it walks like a duck, more than likely it is a duck. I think the time for one time intervention tactics is pretty much over. The Swiss have shown the way and the Japanese will follow, officially or non oficially.
Observation is the path to discovery.
  • #27,195
  • Sep 15, 2011 6:56am Sep 15, 2011 6:56am
Quoting SIgurs
Usd versus Jpy:

- interest rates in both countries are at record lows, so no big difference there
- unemployment in Japan way lower than in the US / 4.7% vs 9.1%
- Japan has larger trade surplusses (%wise) than the US
- savings larger in Japan than US
- far more QE in US than Japan

So, imo, depreciation of Jpy can only happen when Boj/Mof intervene. Based on economic numbers and prospects Jpy will continue appreciating.
But Japan has:

- aging population
- continuing deflationary spiral
- massive (govt)debt:gdp
- shrinking export markets (losing market share to China, Korea etc)
- no natural resources
- ridiculous exchange rate due to way overvalued currency which hinders exports and export led economic recovery
- major energy supply issues looming
- zero (more or less) interest rates

And as a major investor looking for a safe haven, I would buy Yen because???
Doing what you like is Freedom. Liking what you do is Happiness.
  • #27,196
  • Sep 15, 2011 7:05am Sep 15, 2011 7:05am
Quoting realjumper
But Japan has:

- aging population
- continuing deflationary spiral
- massive (govt)debt:gdp
- shrinking export markets (losing market share to China, Korea etc)
- no natural resources
- ridiculous exchange due to way overvalued currency rate which hinders exports and export led economic recovery
- major energy supply issues looming
- zero (more or less) interest rates

And as a major investor looking for a safe haven, I would buy Yen because???
Geopolitically, they also have China next door flexing their muscles and with no Army, Navy or Air Force of their own to speak off. The US has the weapons and a huge ocean separating it from China. That in itself is enough to make the dollar a safe haven. The Yen a safe haven? From what? As 2+2=4ex said today. Japan is sitting on a huge fault line that can go off in many ways.
Observation is the path to discovery.
  • #27,197
  • Sep 15, 2011 7:12am Sep 15, 2011 7:12am
Quoting Alorente
Geopolitically, they also have China next door flexing their muscles and with no Army, Navy or Air Force of their own to speak off. The US has the weapons and a huge ocean separating it from China. That in itself is enough to make the dollar a safe haven. The Yen a safe haven? From what? As 2+2=4ex said today. Japan is sitting on a huge fault line that can go off in many ways.
As we have tragically seen.

So who can explain the continued run to the 'safe haven' Yen, in language that a simpleton like me can understand?
Doing what you like is Freedom. Liking what you do is Happiness.
  • #27,198
  • Sep 15, 2011 7:15am Sep 15, 2011 7:15am
Quoting realjumper
I disagree with the analysis in as much as I think money is flowing into USD and Yen, which is why we're not seeing the UJ pair climbing.
Yep, the reason it's not going anywhere. It's almost pegged! lol.

The orange line is the USD and the purple is the JPY.

USD/JPY H1
Attached Image (click to enlarge)
Click to Enlarge Name: uj1.png Size: 155 KB
  • #27,199
  • Sep 15, 2011 7:17am Sep 15, 2011 7:17am
Quoting fosking
Yep, the reason it's not going anywhere. It's almost pegged! lol.

The orange line is the USD and the purple is the JPY.

USD/JPY H1
Attachment
LOL.......It IS pegged!!!!!
Doing what you like is Freedom. Liking what you do is Happiness.
  • #27,200
  • Sep 15, 2011 7:20am Sep 15, 2011 7:20am
I am will speaking again in coming 30 minutes,are you ready guys
If there was easy money lying around,no one would be forcing it into your
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